International credit rating agency Moody’s has announced that it has changed the outlook on the Ba2 corporate family rating of global steel producer ArcelorMittal to stable from negative.
According to Moody’s, the strong recovery in steel prices in both the US and Europe benefitted the company, with profitability increasing in the second quarter this year to a level Moody’s views as sustainable to the end of the year.
Moody’s stated that the change in outlook to stable from negative reflects ArcelorMittal's commitment to defend its credit profile and Moody's expectation that the company's financial metrics will remain in line with the current rating for the next 12 months. Moody's expects that the company will be able to benefit from the improved steel prices in both core markets of the NAFTA region and Europe to generate a full-year reported EBITDA higher than the current company's guidance of in excess of $4.5 billion. ArcelorMittal is also likely to benefit from the antidumping duties imposed in Europe on cold rolled coils from China and Russia, and in the US for cold and hot rolled coils from various countries including China, South Korea and Japan.